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Researched by Industrial Info Resources (Sugar Land, Texas)--Oil & gas services company Schlumberger Limited (NYSE:SLB) (Houston, Texas) expressed a note of optimism as it delivered its third-quarter results on Friday. "After seven quarters of unprecedented activity declines, the business environment stabilized as expected in the third quarter, confirming that we have indeed reached the bottom of this cycle," said Chief Executive Officer Paal Kibsgaard in a conference call, referring to the unprecedented downturn in oil & gas exploration and production activity following the downturn in oil prices in 2014.
In a statement regarding the earnings, Kibsgaard said: "In the global oil market, the supply and demand of crude is now more or less balanced as evidenced by flattening petroleum inventory levels and the start of consistent draws toward the end of the quarter--particularly in North America. At the same time, oil demand for 2017 was again revised upward in October and if combined with OPEC's announced intention to cut production, this suggests further inventory draws in the coming quarters that should lead to upward movement in prices."
One of areas of strength seen by Schlumberger during the quarter is onshore drilling in North America. In the conference call, Kibsgaard said: "In North America, revenue for the [Reservoir] Characterization, Drilling and Production groups increased 3% sequentially, as solid growth on land was largely offset by further revenue reduction in the Gulf of Mexico, Alaska and eastern Canada, impacting all product groups. The strong growth on land was driven by the U.S., where the Q3 rig count increased significantly, with more than half of the rigs being added in the Permian Basin." The company's Drilling and Measurements group posted a 31% increase in U.S. land revenue compared to the second quarter. "We have shifted focus from maintaining presence to gaining market share for our drilling business in North America land," said Kibsgaard.
Schlumberger's net income was $176 million, compared to $989 million in third-quarter 2015 and a net loss of $2.16 billion in second-quarter 2016.
Industrial Info is tracking $5.04 billion of projects involving Schlumberger. One of the largest of these projects is the $1.5 billion development of the Neptun natural gas field off the coast of Romania. ExxonMobil Corporation drilled an exploration well in the block in 2012 and later found it to be commercially viable. The offshore field has a natural gas production estimate of 630 million cubic feet per day. Schlumberger is acting as a contractor on the project. A proposed pipeline will transport the natural gas extracted from the field to a planned gas terminal. Drilling is expected to begin in the fourth quarter of 2017.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
In a statement regarding the earnings, Kibsgaard said: "In the global oil market, the supply and demand of crude is now more or less balanced as evidenced by flattening petroleum inventory levels and the start of consistent draws toward the end of the quarter--particularly in North America. At the same time, oil demand for 2017 was again revised upward in October and if combined with OPEC's announced intention to cut production, this suggests further inventory draws in the coming quarters that should lead to upward movement in prices."
One of areas of strength seen by Schlumberger during the quarter is onshore drilling in North America. In the conference call, Kibsgaard said: "In North America, revenue for the [Reservoir] Characterization, Drilling and Production groups increased 3% sequentially, as solid growth on land was largely offset by further revenue reduction in the Gulf of Mexico, Alaska and eastern Canada, impacting all product groups. The strong growth on land was driven by the U.S., where the Q3 rig count increased significantly, with more than half of the rigs being added in the Permian Basin." The company's Drilling and Measurements group posted a 31% increase in U.S. land revenue compared to the second quarter. "We have shifted focus from maintaining presence to gaining market share for our drilling business in North America land," said Kibsgaard.
Schlumberger's net income was $176 million, compared to $989 million in third-quarter 2015 and a net loss of $2.16 billion in second-quarter 2016.
Industrial Info is tracking $5.04 billion of projects involving Schlumberger. One of the largest of these projects is the $1.5 billion development of the Neptun natural gas field off the coast of Romania. ExxonMobil Corporation drilled an exploration well in the block in 2012 and later found it to be commercially viable. The offshore field has a natural gas production estimate of 630 million cubic feet per day. Schlumberger is acting as a contractor on the project. A proposed pipeline will transport the natural gas extracted from the field to a planned gas terminal. Drilling is expected to begin in the fourth quarter of 2017.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
